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Economics
Let's look at the economics of buying. If I were to spend $20000.00 for a Marriott on Hilton Head compared to investing the $20000.00 would it make sense to buy? At 6% interest I would return $1200.00. Add $800.00 Management fee and I would have $2000.00 available to rent a unit. This is without any obligation to pay yearly fees. I know that rentals will increase yearly but so will Management fees. What would happen of the resort were hit with a severe hurricane . Would that increase the fees? Also I still have the $20000.00 principal. At what point does buying make sense? What discount to purchase price should I look for to make this formula work?
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